Local government employees may see health care savings

Yolo County and city governments are attempting to cut their employee health care premiums -- and have their employees cut their costs as well.

And all it might take is a relative simple readjustment of boundaries -- and the approval of CalPERS, the state's public employee retirement system.

Within the last several weeks, the Yolo County Board of Supervisors joined other cities in notifying CalPERS they want to be reassigned from the Bay Area Region to the Sacramento Region, a critical designation when it comes to health care costs.

Woodland city officials authorized signing a letter in January. The Yolo County Board of Supervisors signed on by sending its own letter a couple of weeks later.

If approved, the change would affect Woodland, Davis, Winters, West Sacramento, Yolo County and Yolo-Solano Air Quality Management District. Following the county's action, all six agencies have now sought the change in designation.

If ultimately adopted by CalPERS, the migration from one region to the other would affect 270 retired city employees, current workers, as well as Woodland's administration who live in Yolo County; along with hundreds of others countywide.

The difference in cost is simply because health care is cheaper in the Sacramento area and Northern California as a whole than in the Bay Area.

A spokeswoman for CalPERS, Jeanie Esajian, says the board will consider the redesignation this month, although she notes there is, in fact, no "Sacramento Region" but rather a "Northern California Region" which as proposed could include Sacramento, Sutter, Yolo, El Dorado, Napa and others.

CalPERS, wrote Esajian in a letter to The Democrat, has been reviewing its current contracting regions for several months and presented its draft proposed recommendations to make changes to the regions at a Jan. 17 meeting.

The proposed changes could be acted upon as a meeting of the CalPERS Pension and Health Benefits Committee and by the Full Board of Administration this month.

The change in regions occurred in 2010, when CalPERs placed the local agencies in what Woodland human resources officials called the Bay Area Region.

Moving out of that region and its higher health care costs would save everyone money because premiums paid for coverage would fall.

For example, had the switch been made in 2013, the city of Woodland alone would have saved $318,098, while active employees would have saved $190,985 in 2012 on their health insurance payments.

"Many employees who live in Yolo County utilize some of the same physicians, hospitals and services as employees who live in Sacramento," Sheila McShane, human resources manager reported to the Woodland City Council, "except that, the employee, retiree and the city has a higher premium to pay for the same services."

As part of the city's argument for the switch, McShane, notes that Covered California -- the same health care program that hundreds of thousands of Californians are now signing up for to receive health care -- has placed Yolo County residents under the "Sacramento Region."